WASHINGTON, D.C. — Agricultural groups and shippers are pushing back against a White House plan that could deal U.S. farmers and shippers out of some international food aid programming.
According to a June 25 press release from the American Soybean Assoc. (ASA), the House Agriculture Committee is pushing back on an Obama administration proposal to convert more international food aid from physical U.S.-based commodities to local food purchases, food vouchers or cash transfers.
The White House is asking that up to a quarter of the $1.4 billion in international food aid it donates under the Food for Peace Title II programs be converted to local purchases, suggesting it is a more economical way to provide food aid. In last year’s farm bill, Congress gave the USDA and U.S. Agency for International Development (USAID) some flexibility in delivering food aid and established the local and regional food aid procurement (LRP).
Information from USDA’s Foreign Agricultural Service (FAS) states the LRP pilot project was a five-year, $60 million program originally authorized by the 2008 farm bill. It has since been reauthorized. The pilot program was designed to evaluate the timeliness, cost and market impact of purchasing food aid locally or regionally, rather than shipping aid from the United States, to respond to natural disasters and other food crises in developing countries.
"However, the administration continues to push for additional changes," the ASA stated. "General sentiments from the House Agriculture hearing on (June 24) were that these changes are premature and that opening the farm bill is not an endeavor the committee wants to engage in."
In a letter to FAS Administrator Philip Karsting dated July 7, Ag Committee Chair K. Michael Conaway (R-Texas) linked the food aid issue to the Maritime Security Program (MSP), which he said funds the U.S. Merchant Marines. Conaway explained under the Food for Peace Act, implementing partners ship U.S. grown commodities internationally for direct distribution or for sale, also referred to as monetization.
The law requires at least 50 percent of the U.S. agricultural commodities, financed by U.S. food aid programs, be shipped on privately owned, U.S.-flag commercial vessels, some of which are part of MSP.
"This requirement ensures that even in times of peace, commercial vessels stay active," Conaway wrote. "Should the need arise for these vessels to transition to the transport of defense material such as tanks during a ramp-up of our military activity abroad, the U.S. has a fleet – the U.S. Merchant Marines – to augment the Navy ... Food aid programs ensure the fleet will not be scrapped in times of low military conflict globally."
But he said the Maritime Administration and others are looking into raising the MSP stipend from $3.1 million to $5 million because the current stipend is seen as not enough to offset the higher cost of operating a U.S.-flag, U.S.-crewed vessel. He added the plan would have "dire consequences for U.S. farmers and taxpayers, generally."
He went on to explain the proposed plan would obtain money for the increase from U.S. food aid programs in exchange for allowing USAID to spend 45 percent of its food aid budget on local and regional purchases rather than buying food produced in the United States.
"This appears to be another attempt on the part of USAID to shift from U.S. in-kind commodity-based food aid to cash vouchers," Conaway said.
In implementing the LRP pilot authorized in 2008, the USDA demonstrated and reported to Congress that food assistance could in many cases be provided more economically and faster, while protecting and strengthening local markets, Karsting testified June 24.
For example, he said Land O’ Lakes, a so-called implementing partner of Food for Peace administered food aid, told him it was working with local processors in Bangladesh that made cereal bars from chickpeas, peanuts, rice and sesame seeds that supplemented a school feeding program. Land O’ Lakes reported it saw a 27 percent increase in overall school attendance.
Land O’ Lakes also reported local processors have commercialized the cereal bar and are now sourcing from 15,000 farmers in Bangladesh, instead of importing ingredients. Reported production is up to 15 million cereal bars a month.
